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Primerica Life Insurance Co. v. Zapata

United States District Court, D. Maryland, Southern Division

September 7, 2017

LESLIE ZAPATA, et al. Defendants.


          GEORGE J. HAZEL, United States District Judge

         Plaintiff Primerica Life Insurance Company ("Primerica") initiated this litigation as an interpleader action regarding the proceeds from a life insurance policy for the late Lester Foote. and was subsequently counter-sued by the estate of Mr. Foote (the "Estate"), represented by Sandra Foote, Mr. Foote's wife, acting as the Estate's personal representative. ECF No. 104. Specifically, Mrs. Foote's Second Amended Complaint-in-Intervention asserts a claim of negligence against Primerica and seeks $1.4 million in damages. Now pending before the Court is Primerica's Motion for Summary Judgment, ECF No. 139, the Estate's Motion for Prejudgment Interest, ECF No. 116, the Estate's Motion for Extension of Time to Complete FRCP 26(a)(2) Disclosure, ECF No. 117, and Primerica's Cross Motion seeking attorney's fees, ECF No. 118. No hearing is necessary. Loc. R. 105.6 (D. Md. 2016). For the following reasons, Primerica's Motion for Summary Judgment and Cross Motion for attorney's fees are granted, and the Estate's motions for Prejudgment Interest and Extension of Time are denied.

         I. BACKGROUND[1]

         On January 5, 2002, Lester Foole, a master plumber, completed an application for a $1.5 million life insurance policy (the "Policy") from Primerica. See ECF No. 48-1 at ¶¶ 12-13. On the application, Mr. Foote designated his daughters, Leslie P. Pineda (now Leslie Zapata), Nancy A. Pineda (now Nancy Zapata), Susana R. Pineda (now Susana Zapata), Jennifer J. Hughes, and his son, Antoine L. Hughes, as principal beneficiaries. See ECF No. 1-3 at 10.[2] Under the Policy, each daughter was entitled to receive $250, 000 upon Mr. Foote's death and his son was entitled to $200, 000. See Id. Mr. Foote also named his minor goddaughter, MBL, as a principal beneficiary in the 2002 application, entitling her to $100, 000 in proceeds from the Policy. See Id. When Mr. Foote completed the 2002 application, he indicated on the application that these beneficiary designations were irrevocable. See Id. ¶ 14. Pursuant to the terms of the Policy, a beneficiary designated as irrevocable on an application "may not be changed except with the written consent of that Beneficiary." Id.

         In December 2010, Mr. Foote met with his Primerica agent, Jane Williams, in Philadelphia and discussed the possibility of adding Sandra Foote, whom he had married on March 31, 2010, to the Policy. ECF No 139-4 at 4-5. On December 17, 2010, Mr. Foote submitted a Policy Change Application to Primerica, listing Mrs. Foote and MBL as the only beneficiaries but with no specific dollar amount assigned to either beneficiary. ECF No. 1-4. Prior to submitting this Application, Mr. Foote did not obtain the written consent of the irrevocable beneficiaries, as required under the Policy. Upon receiving the Policy Change Application, Primerica sent a letter to Ms. Williams informing her that the Application was insufficient to change Mr. Foote's policy. ECF No. 139-11. Ms. Williams discussed with Mr. Foote that his Application had not been processed, and told him that he would need to obtain the written consent of the existing beneficiaries if he wanted to change the policy. Mr. Foote said that he wanted to think about what he was going to do, and that he would "get around to it." ECF No. 139-4 at 9-10. Mr. Foote did not submit a subsequent Policy Change Application; but, on October 17, 2012, he executed a Revised Operating Agreement for his business (an LLC), which gave Mrs. Foote and her son joint tenancy and right of survivorship over 65% and 35% of the LLC, respectively. ECF No. 139-13.

         Ultimately, Mr. Foote died unexpectedly without a will on December 26, 2013. See ECF No. 1 ¶ 19. Following his death, Primerica filed the instant interpleader complaint so that Mr. Foote's various beneficiaries and family members could present their claims to the proceeds of the Policy.

         In response to the interpleader complaint, Mrs. Foote and MBL filed counterclaims against Primerica for breach of contract, negligence, and estoppel. See ECF No. 46; ECF No. 48. On March 16, 2015, the Court granted Primerica's Motion to Dismiss those counterclaims, but allowed the Estate to intervene, and suggested that it was possible that the Estate could bring a claim against Primerica. See ECF No. 68 at 12 n.7. The Estate subsequently brought a complaint, ECF No. 71, which was amended twice, ECF No. 76; ECF No. 104. In its most recent version, the complaint alleges that Primerica was negligent in failing to add Mrs. Foote to Mr. Foote's insurance policy, and seeks $1.4 million in damages (the amount that Mrs. Foote allegedly would have received under a revised policy). ECF No. 104. On September 15, 2016, the Estate filed a Motion for Prejudgment Interest, alleging that Primerica owed interest on the life insurance proceeds as it had not deposited them in the Court's registry. ECF No. 116. On September 19, 2016, the Estate filed another motion, requesting an extension of time to complete its Fed.R.Civ.P. 26(a)(2) disclosire. ECF No. 117. On October 3, 2016, Primerica filed a cross-motion requesting, among other things, attorneys' fees. ECF No. 118. On December 15, 2016, pursuant to a stipulation between ihe parties, the entirety of the insurance proceeds were deposited with the Court, and the Interpleader Defendants agreed to have the funds distributed amongst themselves, with an appropriate amount held back to cover potential attorney's fees and estate taxes. ECF No. 132. Prinerica has since moved for summary judgment on the negligence claim, arguing that there are no disputed material facts, and that Primerica is entitled to judgment as a matter of law. ECF No. 139.

         For the reasons slated below, the Court finds that Primerica is entitled to judgment as a matter of law on the Estate's negligence claim. After resolving the motion for summary judgment, the Court will address the remaining motions.


         Summary judgment is appropriate if the "materials in the record, including depositions, documents, electronically stored information, affidavits or declarations, stipulations ..., admissions, interrogator answers, or other materials, " Fed.R.Civ.P. 56(c), show that there is "no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). The party moving for summary judgment bears the burden of demonstrating that no genuine dispute exists as to material facts Pulliam Inv. Co. v. Cameo Props., 810 F.2d 1282, 1286 (4th Cir. 1987). If the moving party demonstrates that there is no evidence to support the non-moving party's case, the burden shifts to the non-moving party to identify specific facts showing that there is a genuine issue for trial. See Celotex, 477 U.S. at 322-23. A material fact is one that "might affect the outcome of the suit under the governing law." Spriggs v. Diamond Auto Glass, 242 F.3d 179, 183 (4th Cir. 2001) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)). A dispute of material fact is only "genuine" if sufficient evidence favoring the nonmoving party exists for the trier of fact to return a verdict for that party. Anderson, 477 U.S. at 248. However, the nonmoving party "cannot create a genuine issue of material fact through mere speculation or the building of one inference upon another." Beale v. Hardy, 769 F.2d 213, 214 (4th Cir. 1985). With this standard in mind, the Court turns to Primerica's motion for summary judgment and the evidentiary rulings needed to resolve the motion.


         A. Evidentiary Determinations

         As an initial matter, both parties allege that evidence relied on by the other party is inadmissible. See ECF No. 142 at 10; ECF No. 147 at 6. When ruling on a motion for summary judgment, courts must ensure that "affidavits must be made on personal knowledge with such facts as would be admissible in evidence." United States v. Hartford Accident & Indem. Co., 168 F.Supp.3d 824, 831 (D. Md. 2016) (citing Fed.R.Civ.P. 56(c)(4)).

         Here, the Estate asserts that there are three pieces of evidence relied upon by Primerica that are hearsay and inadmissible under Md. Code Ann., Cts. & Jud. Proc. § 9-116, commonly known as Maryland's Dead Man Statute. Each piece of evidence comes from the affidavit of Primerica's agent, Ms. Williams, and consists of a statement allegedly made by Mr. Foote. The statements objected to are:

"Lester Foote discussed with Ms. Williams possibly making a change to his Primerica Policy so that Sandra Foote, whom he had married on March 31, 2010, would receive some benefit from the policy. "
"They discussed making a change so that Ms. Foote would receive the $200, 000 that had not previously been assigned to any beneficiary on the initial application."
• "On December 23, 2010, Primerica sent a letter to Ms. Williams informing her that changes could not be made based upon the Policy Change Application that it had received. See Ex. H. Ms. Williams discussed the letter with Lester Foote. Ex. A at 59. She told Lester Foote that if he wanted to make Sandra Foote the beneficiary of the Primerica Policy, he would need to have the existing beneficiaries consent in writing to being removed from the Primerica Policy. Id. at 66- 67. Mr. Foote explained that he wanted to think about what he was going to do and that he would get around to it. "

ECF No. 142 at 10-11 (emphasis in original).

         Similarly, Primerica argues that "Sandra Foote's [deposition] testimony regarding what Lester Foote allegedly said to Jane Williams in the summer of 201 land in 2013 after the death of Mr. Foote's mother is inadmissible under Maryland's Dead Man's Statute." ECF No. 147 at 6.

         The Court addresses the parties' arguments under Maryland's Dead Man Statute first, and then turns to ...

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